Putin wants to boost share of small & medium-sized businesses in Russia

Russian President Vladimir Putin has underlined the importance of small and medium-sized businesses in any country’s economy and urged smaller companies be given more freedom in the future.

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The Russian president was speaking at a meeting with German business leaders in Sochi on Thursday.

“I think you will agree that the cooperation of our countries should not be limited only to major projects, an important driver for the development of the modern economy is small and medium businesses. In Germany, small business accounts for more than half of the country’s GDP,” said Putin.

“The share is much less in Russia, unfortunately, but we set a goal to make small and medium businesses account for 30 to 40 percent of the Russian economy by 2030,” Putin stressed.

The president said he would be interested to hear proposals from German businessmen on how to connect small and medium-sized businesses to Russian-German economic links.

“Of course, we are interested in the opinion of our foreign partners, what in general makes it difficult to do business in Russia, what additional support from the state is needed to our partners from abroad,” he said.

Russian economists have said small and medium-sized businesses often face limited domestic demand, the dominance of large economic and financial structures in the economy, expensive loans, and red tape.

Putin has repeatedly stressed the importance of small and medium-sized business for the Russian economy.

Data from 2016 says that only 5.8 percent of Russians of working age start their own business, the lowest among the BRICS countries, while almost one in five Brazilian starts his own business. To boost entrepreneurship in Russia, the government has offered better tax terms, a three-year moratorium on scheduled inspections and a quota in procurements by Russia’s big corporations.